7 Signs Your CEO Might Not Really Be Going Big

Hey everybody. There's so many great and exciting startups out there. How do you know which one to join? If you're looking for a job, or if you're an angel or venture investor, how do you know which ones to invest in? Well, let's talk about some of the signs that an entrepreneur might not really be going for it, that might not really have a big vision. And I'm not being critical of it. Being a founder is incredibly difficult and building a business of any size is a monumental achievement. But if you're an employee, if you're a team member, if you're an investor these days, you want to know if a founder is really going for it, if your options can really be worth some money, if they want to build something big. And everything can sound exciting in the early days. But let me give you seven signs that the CEO that you're talking to might not really be going for it. The first one is, is a CEO that talks a lot about selling the company for say 20 to 30 million dollars. And look, 20 to 30 million dollars is a jaw dropping amount of money. Don't get me wrong, it's crazy, but a CEO in the age of unicorns, there's more than 500 SaaS. Unicorns, there'll soon be a thousand SaaS, companies worth a billion or more. Not everyone can get there. But if you don't dream of it, the odds of you achieving it are low. So when I hear a CEO talk too much about selling for smaller amounts of money, right? 10, 20, 30 million, I know that nine times out of 10 they're not really dreaming big and they won't achieve something big. So if you're okay with that, great. But realize it dramatically decreases the odds you're joining a unicorn. Second point, this is a big flag. Check social media, check Twitter, especially check Facebook. But when you hear a lot of immature language from the CEO, I think this is a flag. It doesn't matter if they're a first time CEO. It doesn't matter if they're just out of school or never even went to college. Your job as a CEO, you have customers, you have partners, you have employees, you have folks to inspire. You have to carry yourself not as the CEO that you are today, not as a CEO of a three person or 10 person or 20 person company. You have to carry yourself as the CEO you want to be in two or three years. Be that person. That's what customers are looking for, that's what employees are looking for, and that's how you should act. Don't act today like you're Marc Benioff or Stuart Butterfield or Todd McKinnon. You're not there, okay? But act like a CEO that of a company two to three years bigger than you. If you're a 2 million ARR, act like folks that are at 10 or 20 million ARR or more. That's what folks expect. So when I see a lot of immature comments on Twitter or social media, as well as a lot of distracted comments, comments of jealousy, too much. Too much about other things and not enough about their company, I worry. I worry if it's too immature that they're not really going to be able to inspire folks and build something that will last. Point 3 Lack of fluency in the competition in the competitive landscape, there are a few things to me that are a worse sign than when a CEO just bashes the competition. No, the best CEOs are they're proud of winning, don't get me wrong. But the best CEOs are super respectful of the competition. Both the current competition. Because the CEOs know everything. They know every up and coming competitor, everyone that's bigger than them and they know what they're good at. They're respectfully something and they're often even respectful of the big guys. You can make fun of PayPal, but PayPal worth 300 billion? Be careful before you mock a PayPal or a Salesforce that's worth over 200 billion. Or you say that Shopify is old. Well yeah, of course Shopify wasn't founded last week, but it's worth a hundred and some odd billion dollars. So you've got to know what everyone's good at, not just what they're bad at. Of course the bigger competition stack is older, of course, but it does a lot. So when I hear folks bashing the competition too much without begrudging respect, it's a sign of someone not really going for it. About someone that does not really understand where the puck is going, where the future is going and how to how to how to get there. Point four and this is one it's hard to see if you just meet someone once, but when you've gotten to them over time is when strategy changes too often. When they go from freemium to enterprise to mid market to a horizontal play to a vertical play, to this and that. There's an old expression that tactics can change quarterly or even faster, but your strategy maybe, maybe should only change every few years. I think that that's right. It takes a while to execute something big. It Takes a while to get those releases out, to build up that corpus of features. And sometimes the tactics are radically wrong. Sometimes you think the way to change a category is with SMBs and it turns out to be enterprises. Sometimes you think it's with recurring revenue, it turns out to be payments. A lot of things can change any founder. Listen to the interviews we do at Saster and you'll hear how much of their how different it ended up being than they thought in the early days. But the overall strategy, who you want to make happy, how you want to do it at scale, what they need, how you're going to change the market, how you're going to beat this competition that you respect, that shouldn't change too often. Or you have a schizophrenic founder that doesn't really know what they're building. Okay, point five, Founders that don't really know what their customers think. This one, it's a sign. Ask. Ask a CEO when you meet them in SaaS. At least the best CEOs are always close to the customers. They always talk to customers. And look, I know we'd all love to just not have to do those zooms. And if we ever can again not get on planes and visit customers, it's easier just to type on our computers. But your customers are your lifeblood. They're what it's all about. And I am constantly surprised when I'll talk to founders that have even gotten to a million, 2 million or more in revenue and they're too detached from the customers. They don't really. I do this question, I ask, who are your five largest customers? Great. Okay, tell me why they bought you. Tell me what their motivations were. When the CEO doesn't know, it's a big flag because they're not talking to them. It's great that you have a sales team and it's great that you have a co founder. But the CEO needs to know what their top customers think. The great ones always know why their top customers bought, what the reason was, what the 10x feature was, how they convinced them to close. The top CEOs always know. So ask the CEO what Who the top customers are and why they bought and what they think. And if they hesitate, it's a flag. Okay, point six, it's a flag. Hiring is hard. And not everyone can start off on day one has the money or the time or the capabilities to hire a whole suite of VPs. Many of us won't even get to 8 or 10 million in revenue before we hire all our VPs. But if you don't have any great VPs, as that's a flag, a CEO should always have found one by a million or 2 million in revenue. When you hear excuses, when there's no one great on the management team, maybe that's you. Maybe you're the first VP going in, and maybe that's okay. But be wary of startups where you like the CEO. They're charismatic, they're passionate, but there's no one great on the management team. There's no one greater than the founders. That's a bad sign, because for both CEOs and VPs, half the job after the early days is recruiting, recruiting people better than you. And if they can't do it, if there's not a single example, if there's not one single great person they've recruited to the team, I might end the zoom early. Okay, last point, and I know many of you have seen this. Be wary about joining a startup or working with a CEO that doesn't share enough metrics or data. It's just a flag. And this is especially if things are perfect. I see that. Listen. Everyone tweets out how great they're doing when they had an amazing month or quarter. Hooray. That's hardly transparency. But the best CEOs become even more transparent when times are tough. We just had Tom McKinnon, CEO of $40 billion OCTA. We had him on our podcast and our last digital event, you can go see it on YouTube. And he shared how just a little while ago, he tweeted out how on the last Gartner report, they did not perform as well as they thought. I mean, wow, I was amazed to see that. But his point is that that brings everybody together. Share the tough News. The best CEOs do that. And in the earlier stages, the best CEOs share when they have a rough quarter or when things don't go as they expected. They know. They know the team can handle it. They know the team, like Todd McKinnon said, will respond to that. Great folks will respond to a challenging month or quarter and do even better. But what I find is the mediocre CEOs just, they go dark, the investor updates stop coming, the Sony baloney excuses come out. And I don't see it come back when those investor updates stop coming. Great ones rarely come back later. But when the investor updates go from things are good to things are rough to these are our challenges, but they keep coming. Nine times out of 10, those customers get through their year of hell, their tough time and they come out stronger. So be wary of CEOs that won't share enough metrics, won't share enough data, and won't share when things have been tough. The best ones always do.